Sembcorp Marine H1 performance improves as losses narrow to S$142.9m

SEMBCORP Marine’s losses narrowed to S$142.9 million for the half year ended Jun 30, an improvement from last year’s net loss of S$647.2 million, it said in a results filing on Friday (Aug 12).

The company said a strong execution of multiple projects had contributed to continuing sequential improvement in its financial performance.

For H1, loss per share stood at S$0.0046, down from losses of S$0.0501 per share a year ago.

Turnover for the marine and offshore engineering group increased 29.7 per cent to S$1.1 billion from S$844.2 million previously.

Sembmarine attributed the recovery to “significantly higher revenue recognition” from floater projects after settling the final contract negotiation upon completion, as well as contributions from new projects.

This was however, offset by lower contributions from its repair and upgrade business and lower revenue recognition from offshore platform projects which are nearer to completion.

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As at Jun 30, the group recorded a net order book of S$2.52 billion — 74 per cent of which are accounted for via its renewable wind energy and other cleaner and green solutions, up from 43 per cent in H2 2021.

Net equity ratio also improved in the first half of this year to 0.44 times, compared with 0.49 times at the end of FY2021. 

"Overall orders visibility has progressively improved since the beginning of the year, underpinned by rising oil prices and renewed concerns of energy security in the wake of geopolitical tensions," said the company in its financial report. 

"Oil and gas companies and energy suppliers have picked up pace in reviewing ongoing new projects and previously deferred activities. The group is actively working on multiple tender opportunities in the O&M, offshore wind/renewables and new energy segments, as well as offshore vessels upgrading projects."

While Sembmarine expects its business performance to continue to improve, the company still expects to book a net loss for the financial year 2022.

No dividends were recommended for the half year financial period. 

Sembmarine : S51 0% fell 5.9 per cent or S$0.007 at S$0.112 as at the midday trading break.

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